Orange County car sales jump 24 percent

Driven largely by an improving economy and low interest rates, new light-vehicle registrations rose nearly 24 percent during the past year, according to an annual report by the Orange County Automobile Dealers Association. In all, 149,630 new cars hit the road. The increase was nearly twice the national rate, which climbed about 13 percent above 2011 sales.

“We've seen a tremendous amount of growth,” said John Sackrison, executive director of the association. “Last year was the best year since 2007.”

The tentative rebound in the economy has coaxed many consumers – who had put off buying new cars during the downturn – back onto dealer lots.

Sackrison noted that the average age of cars on the road today is nearly 11. That longevity, combined with dramatic improvements in vehicle features and improved reliability, has made new cars a better value.

Many new vehicles also have good fuel economy, which has been a big selling point for Orange County drivers, he said.

Hybrid and electric vehicles accounted for nearly 8 percent of all vehicles sold in Orange County by the end of 2012. That number has almost doubled in the past three years.

Even more telling: The most popular car in the county last year was the
Toyota Prius. The hybrid accounted for more than 7,000 new-vehicle registrations, or about one out of every 20 cars sold in Orange County.

“The Prius has been well-received,” said Paul Lunsford, vice president and general manager of
South Coast Toyota in Costa Mesa. “It's a safe car and comfortable. And for a four-door sedan, it's generated a reputation as being a hip car.”

With the Prius and Camry models driving business, Lunsford said the dealership sold nearly 2,300 vehicles in 2012, a 35 percent increase from the previous year.

At dealerships across the county, buyers flocked to smaller vehicles. Last year, small cars saw the biggest gain in market share in Orange County, grabbing an additional 2.5 percentage points, while gas-guzzling SUVs and pickups lost ground.

“Gas mileage is now one of the first factors most consumers buying non-luxury vehicles consider before making a purchase,” said Jesse Toprak, an analyst with car pricing website Truecar.com. “The way people buy cars has changed.”

There has also been a distinct shift toward Asian automakers. Japanese companies such as Toyota and South Korean carmakers such as
Hyundai both increased their Orange County market share last year at the expense of domestic companies.
Chevrolet and
Ford, in particular, did not sell as well in Orange County as elsewhere in the U.S.

Several Asian brands have well-established business outposts in Southern California. Hyundai, for instance, is building a $150 million U.S. headquarters just off the 405 in Fountain Valley.

Toprak said non-U.S. car brands tend to do well in demographically diverse markets such as Orange County.

The dealers association expects overall sales to grow again this year, which would mark the fourth consecutive year-over-year gain. The group predicts about 161,000 sales this year, or a 7.6 percent annual increase.

The association cited rising taxes and continued economic uncertainty for the drop in the expected growth rate. But Sackrison said the rate is a more sustainable level than has been seen in recent years; since 2009, annual sales figures are up 54 percent.

“There's not going to be as many peaks and valleys,” he said. “I think we're going to see a more steady and consistent growth.”

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